Company expands reach of O&O platforms via strategic title expansions and product innovation
Pocket Gamer Connects to add three new international events in 2025
Luminosity Gaming’s 2025 Rising Stars campaign surpasses 500 million impressions, with deep community engagement, while securing eleven third party sponsors
TORONTO, May 15, 2025 (GLOBE NEWSWIRE) -- Enthusiast Gaming Holdings Inc. (“Enthusiast Gaming” or the “Company”) (TSX: EGLX), a leading gaming media and entertainment company, today announced financial results for the three months ended March 31, 2025 (“Q1 2025”).
“We’ve spent the last year rebuilding Enthusiast Gaming into a leaner, more focused business, and now that structure is starting to deliver,” said Adrian Montgomery, Interim CEO of Enthusiast Gaming. “With higher yield in our programmatic business, growth in paid subscriptions, event revenue accelerating, and early momentum in direct sales, what we’ve built is an engine that turns audience into value. As our reach expands, our ability to monetize each interaction becomes even more powerful. With a stronger foundation now in place, we’re well-positioned to scale responsibly and continue executing on our mission to spend more time with more gamers. Every part of our ecosystem is now aligned around this goal.”
Alex Macdonald, CFO of Enthusiast Gaming, added, “With gross margins stabilizing above 70% and cash-based operating expenses significantly reduced, we’re seeing the benefits of a leaner, more efficient structure. We’ve refocused around our highest-margin products and properties, and as engagement continues to grow, our ability to convert that activity into financial performance is improving. Our priority now is to remain disciplined while positioning the Company for the second half of the year, when stronger seasonal trends and audience expansion are expected to have a meaningful impact.”
Financial Highlights for Q1 2025
Business Highlights for Q1 2025
First Quarter 2025 Results Comparison
Revenue was $12.2 million in Q1 2025, a 48% decrease compared to $23.3 million in Q1 2024. Media and Content revenue was $5.6 million in Q1 2025, a 65% decrease from $15.9 million in Q1 2024. The Company’s strategic decision to de-prioritize the lower margin video platform revenue accounted for $5.1 million of the $10.3 million reduction. Direct Sales (the majority of which is included in media and content revenue) decreased from $6.6 million in Q1 2024 to $2.3 million in Q1 2025 mainly due to a lower number of ramped sellers than the year ago period, contributing a $4.3 million to the decline in revenue. Esports and Entertainment revenue was $3.6 million in Q1 2025 compared to $3.4 million in Q1 2024, Esports and Entertainment revenue remained relatively flat. Subscription revenue decreased from $4.0 million in Q1 2024 to $3.0 million in Q1 2025, a 25% decrease, in part due to change in mix of subscribers and due to the sale of certain non-core, non-profitable assets in April 2024.
Gross profit was $9.0 million in Q1 2025, a 36% decrease compared to $14.1 million in Q1 2024. Gross margin increased to 74.3% in Q1 2025 from 60.3% in Q1 2024.
Adjusted EBITDA loss was $2.6 million in Q1 2025 compared to an Adjusted EBITDA loss of $1.8 million in Q1 2024.
Net loss $6.1 million, or $(0.04) per share, in Q1 2025, compared to $1.3 million, or $(0.01) per share, in Q1 2024.
Investor Conference Call
Management will host a conference call and webcast on Thursday, May 15, 2025, at 5 p.m. ET to review and discuss its Q1 2025 results. Conference call details:
A replay will be available on Enthusiast Gaming’s website at enthusiastgaming.com/investors.
Supplemental Information
Enthusiast Gaming’s financial statements and management discussion and analysis (“MD&A”) are available at www.sedarplus.ca and enthusiastgaming.com/investors. All amounts are in Canadian dollars.
About Enthusiast Gaming
Enthusiast Gaming is a leading gaming media and entertainment company, building the largest platform for video game enthusiasts and esports fans to connect and compete worldwide. Combining the elements of its four core pillars: creators, content, communities, and experiences, Enthusiast Gaming provides a unique opportunity for marketers to create integrated brand solutions to connect with coveted Gen Z and Millennial audiences. Through its proprietary mix of digital media, content and gaming assets, Enthusiast Gaming continues to grow its network of communities, reflecting the scale and diversity of gaming enthusiasts today.
Contacts
Enthusiast Gaming: Alex Macdonald, Chief Financial Officer
Investors: investor@enthusiastgaming.com
Media: press@enthusiastgaming.com
Forward-Looking Statements
This news release contains certain statements that may constitute forward-looking information under applicable securities laws. All statements, other than those of historical fact, which address activities, events, outcomes, results, developments, performance or achievements that Enthusiast Gaming anticipates or expects may or will occur in the future (in whole or in part) should be considered forward-looking information. Often, but not always, forward-looking information can be identified by the use of words such as “plans”, “expects”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “anticipates”, or “believes” or variations (including negative variations) of such words and phrases, or statements formed in the future tense or indicating that certain actions, events or results “may”, “could”, “would”, “might” or “will” (or other variations of the forgoing) be taken, occur, be achieved, or come to pass. Forward-looking statements in this news release include, but are not limited to, statements regarding trends in certain financial and operating metrics of the Company, and expectations relating to the financial performance and the financial results of future periods.
Forward-looking statements are based on assumptions and analyses made by the Company in light of its experience and its perception of historical trends, current conditions and expected future developments, including, but not limited to, expectations and assumptions concerning: interest and foreign exchange rates; capital efficiencies, cost saving and synergies; growth and growth rates; the success in the esports and gaming media industry; the Company’s growth plan, and judgment applied in the application of the Company’s accounting policies and in the preparation of financial statements in accordance with applicable financial reporting standards. While Enthusiast Gaming considers these assumptions to be reasonable, based on information currently available, they may prove to be incorrect. Readers are cautioned not to place undue reliance on forward-looking statements. In addition, forward-looking statements necessarily involve known and unknown risks, including, without limitation, risks associated with general economic conditions; adverse industry events; and future legislative, tax and regulatory developments. Readers are cautioned that the foregoing list is not exhaustive. For more information on the risks, uncertainties and assumptions that could cause anticipated opportunities and actual results to differ materially, please refer to the public filings of Enthusiast Gaming which are available on SEDAR+ at www.sedarplus.ca. Readers are further cautioned not to place undue reliance on forward-looking statements as there can be no assurance that the plans, intentions or expectations upon which they are placed will occur. Such information, although considered reasonable by management at the time of preparation, may prove to be incorrect and actual results may differ materially from those anticipated. Forward-looking statements contained in this news release are expressly qualified by this cautionary statement and reflect our expectations as of the date hereof, and thus are subject to change thereafter. Enthusiast Gaming disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.
Non-GAAP Measures
This press release references certain non-GAAP measures, including Adjusted EBITDA, as described below. These non-GAAP measures are not recognized measures under GAAP and do not have a standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other companies. Rather, these measures are provided as additional information to complement those GAAP measures by providing further understanding of the Company’s results of operations from management’s perspective. Accordingly, these measures should not be considered in isolation nor as a substitute for analysis of the Company’s financial information reported under IFRS.
The Company uses non-GAAP measures including:
“EBITDA”, which is defined as earnings before interest, taxes, depreciation and amortization. Enthusiast Gaming calculates EBITDA using gross margin less total operating expenses plus share-based compensation and amortization and depreciation; and,
“Adjusted EBITDA”, which is defined as EBITDA adjusted for severance and other non-recurring public costs. These non-recurring costs include, but are not limited to, annual directors and officers (“D&O”) liability insurance associated with the Company’s former listing on Nasdaq. Adjusted EBITDA also excludes “NFL TNG EBITDA” which is defined as EBITDA attributable to the Company’s NFL TNG program during Q4 2024 and thereafter, as the program became non-recurring due to its termination.
Neither the Toronto Stock Exchange nor its Regulation Services Provider (as that term is defined in the policies of the exchange) accepts responsibility for the adequacy or accuracy of this release.
Enthusiast Gaming Holdings Inc.
Condensed Consolidated Interim Statements of Loss and Comprehensive Loss
For the three months ended March 31, 2025 and 2024
(Unaudited - Expressed in Canadian Dollars)
| March 31, 2025 | March 31, 2024 | |||||||
| Revenue | $ | 12,162,537 | $ | 23,328,239 | ||||
| Cost of sales | 3,129,349 | 9,252,080 | ||||||
| Gross margin | 9,033,188 | 14,076,159 | ||||||
| Operating expenses | ||||||||
| Professional fees | 413,740 | 552,558 | ||||||
| Consulting fees | 264,715 | 1,452,236 | ||||||
| Advertising and promotion | 417,038 | 479,804 | ||||||
| Office and general | 1,048,101 | 994,398 | ||||||
| Salaries and wages | 6,118,720 | 8,346,301 | ||||||
| Technology support, web development and content | 4,721,241 | 4,268,659 | ||||||
| Esports player, team and game expenses | 522,042 | 609,112 | ||||||
| Foreign exchange (gain) loss | (88,879 | ) | 105,935 | |||||
| Share-based compensation | 55,206 | (1,998,257 | ) | |||||
| Amortization and depreciation | 647,950 | 715,494 | ||||||
| Total operating expenses | 14,119,874 | 15,526,240 | ||||||
| Other expenses (income) | ||||||||
| Share of net income from investment in associates and joint ventures | - | (25,382 | ) | |||||
| Interest and accretion | 848,186 | 623,214 | ||||||
| Loss on revaluation of long-term debt | 14,290 | - | ||||||
| Gain on revaluation of deferred payment liability | (128,649 | ) | (16,900 | ) | ||||
| Interest income | (5,489 | ) | (5,053 | ) | ||||
| Net loss before income taxes | (5,815,024 | ) | (2,025,960 | ) | ||||
| Income taxes | ||||||||
| Current tax expense | 47,453 | 102,583 | ||||||
| Deferred tax expense | 181,287 | 173,204 | ||||||
| Net loss for the period | (6,043,764 | ) | (2,301,747 | ) | ||||
| Other comprehensive (loss) income | ||||||||
| Items that may be reclassified to profit or loss | ||||||||
| Foreign currency translation adjustment | (85,313 | ) | 986,126 | |||||
| Net loss and comprehensive loss for the period | $ | (6,129,077 | ) | $ | (1,315,621 | ) | ||
| Net loss per share, basic and diluted | $ | (0.04 | ) | $ | (0.01 | ) | ||
| Weighted average number of common shares | ||||||||
| outstanding, basic and diluted | 159,169,003 | 155,678,040 | ||||||
Enthusiast Gaming Holdings Inc.
Condensed Consolidated Interim Statements of Financial Position
As of March 31, 2025
(Unaudited - Expressed in Canadian Dollars)
| March 31, 2025 | December 31, 2024 | |||||||
| ASSETS | ||||||||
| Current | ||||||||
| Cash | $ | 1,945,047 | $ | 4,765,373 | ||||
| Trade and other receivables | 7,814,356 | 12,351,539 | ||||||
| Income tax receivable | - | 12,371 | ||||||
| Prepaid expenses | 608,370 | 2,010,796 | ||||||
| Total current assets | 10,367,773 | 19,140,079 | ||||||
| Non-current | ||||||||
| Property and equipment | 170,200 | 187,464 | ||||||
| Right-of-use assets | 651,368 | 800,908 | ||||||
| Long-term portion of prepaid expenses | 148,412 | 148,546 | ||||||
| Intangible assets | 71,364,517 | 71,815,485 | ||||||
| Goodwill | 36,460,703 | 36,353,244 | ||||||
| Total assets | $ | 119,162,973 | $ | 128,445,726 | ||||
| LIABILITIES AND SHAREHOLDERS' EQUITY | ||||||||
| Current | ||||||||
| Accounts payable and accrued liabilities | $ | 14,038,750 | $ | 15,022,630 | ||||
| Contract liabilities | 4,888,771 | 5,735,275 | ||||||
| Income tax payable | 112,464 | 131,441 | ||||||
| Current portion of long-term debt | 37,617,048 | 38,990,332 | ||||||
| Current portion of deferred payment liability | 2,321,876 | 2,322,274 | ||||||
| Current portion of lease liabilities | 697,750 | 727,525 | ||||||
| Total current liabilities | 59,676,659 | 62,929,477 | ||||||
| Non-current | ||||||||
| Long-term portion of lease liabilities | 148,925 | 295,977 | ||||||
| Deferred tax liability | 13,661,893 | 13,470,905 | ||||||
| Total liabilities | $ | 73,487,477 | $ | 76,696,359 | ||||
| Shareholders' Equity | ||||||||
| Share capital | 461,607,373 | 461,607,373 | ||||||
| Warrants reserve | 1,823,168 | 1,823,168 | ||||||
| Contributed surplus | 17,651,401 | 17,596,195 | ||||||
| Accumulated other comprehensive income | 11,456,885 | 11,542,198 | ||||||
| Deficit | (446,863,331 | ) | (440,819,567 | ) | ||||
| Total shareholders' equity | 45,675,496 | 51,749,367 | ||||||
| Total liabilities and shareholders' equity | $ | 119,162,973 | $ | 128,445,726 | ||||
Enthusiast Gaming Holdings Inc.
Condensed Consolidated Interim Statements of Cash Flows
For the three months ended March 31, 2025 and 2024
(Unaudited - Expressed in Canadian Dollars)
| March 31, 2025 | March 31, 2024 | ||||||
| Cash flows from operating activities | |||||||
| Net loss for the period | $ | (6,043,764 | ) | $ | (2,301,747 | ) | |
| Items not affecting cash: | |||||||
| Amortization and depreciation | 647,950 | 715,494 | |||||
| Share-based compensation | 55,206 | (1,998,257 | ) | ||||
| Accretion | (47,851 | ) | 10,296 | ||||
| Deferred tax expense | 181,287 | 173,204 | |||||
| Share of net income from investment in associates and joint ventures | - | (25,382 | ) | ||||
| Loss on revaluation of long-term debt | 14,290 | - | |||||
| Gain on revaluation of deferred payment liability | (128,649 | ) | (16,900 | ) | |||
| Foreign exchange gain | (140,291 | ) | (310,997 | ) | |||
| Gain on settlement of accounts payable | (14,352 | ) | (622,413 | ) | |||
| Provisions | 121,344 | 241,066 | |||||
| Changes in working capital: | |||||||
| Changes in trade and other receivables | 4,415,839 | 16,644,565 | |||||
| Changes in prepaid expenses | 1,402,381 | 924,542 | |||||
| Changes in accounts payable and accrued liabilities | (969,528 | ) | (16,128,250 | ) | |||
| Changes in contract liabilities | (846,504 | ) | (2,189,586 | ) | |||
| Changes in income tax receivable and payable | 64,010 | 110,400 | |||||
| Income tax paid | (70,902 | ) | (23,152 | ) | |||
| Net cash used in operating activities | (1,359,534 | ) | (4,797,117 | ) | |||
| Cash flows from investing activities | |||||||
| Acquisition of property and equipment | - | (994 | ) | ||||
| Net cash used in investing activities | - | (994 | ) | ||||
| Cash flows from financing activities | |||||||
| Proceeds from long-term debt, net of transaction costs | 11,760 | 496,252 | |||||
| Repayment of long-term debt | (1,319,575 | ) | (717,608 | ) | |||
| Lease payments | (185,547 | ) | (208,370 | ) | |||
| Net cash used in financing activities | (1,493,362 | ) | (429,726 | ) | |||
| Foreign exchange effect on cash | 32,570 | 94,953 | |||||
| Net change in cash | (2,820,326 | ) | (5,132,884 | ) | |||
| Cash, beginning of period | 4,765,373 | 6,851,966 | |||||
| Cash, end of period | $ | 1,945,047 | $ | 1,719,082 | |||
Enthusiast Gaming Holdings Inc.
EBITDA and Adjusted EBITDA
For the three months ended March 31, 2025 and 2024
(Unaudited - Expressed in Canadian Dollars)
| For the three months ended | |||||||
| March 31, 2025 | March 31, 2024 | ||||||
| Gross margin | $ | 9,033,188 | $ | 14,076,159 | |||
| Operating expenses | (14,119,874 | ) | (15,526,240 | ) | |||
| Share-based compensation | 55,206 | (1,998,257 | ) | ||||
| Amortization and depreciation | 647,950 | 715,494 | |||||
| EBITDA | (4,383,530 | ) | (2,732,844 | ) | |||
| Severance | 151,284 | 584,198 | |||||
| D&O insurance specific to the Company's former Nasdaq listing | 201,478 | 379,035 | |||||
| NFL TNG EBITDA | 1,422,838 | - | |||||
| Adjusted EBITDA | $ | (2,607,930 | ) | $ | (1,769,611 | ) |